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Management Accounting Research, 2002, 13, 273–297
Risk in the process of budgeting
Paul M. Collier* and Anthony J. Berry†
Risk in financial management has become a central pre-occupation of 代写留学生论文corporate governance(International Federation of Accountants, 1999; Institute of Chartered Accountantsin England and Wales, 1999) however little is known about how organizations construe
risk in the financial management process.This paper describes four exploratory and comparative case studies that were carried
out with the aim of understanding the relationship between risk and how managersperceived and managed risk in the budgeting process.
The case analysis results suggest that organizational participants socially construct risk.
Four domains of risk were identified: financial, operational, political and personal. These
domains of risk influenced the content and process of budgeting that were categorized
https://www.51lunwen.org/Accounting/as Risk Modelled, Risk Considered or Risk Excluded. In particular, by excluding some
risks and considering others, the budget process was seen to be different to, and needed
to be interpreted separately from, the content of the budget in which there was little
evidence of risk modelling or the use of probabilities. The research also showed how riskis transferred within and between organizations and how managers may contain risk.While these were exploratory case studies it was evident that risk and how it wasconstrued, understood and managed in the financial management process was a centralconcern of managers and that further research is necessary to extend this knowledge.

c 2002 Elsevier Science Ltd. All rights reserved.
Key words: risk; budgeting; domains of risk; risk modelled; riskconsidered; risk excluded; risktransfer; risk containment.
Introduction
Despite recent reports (International Federation of Accountants, 1999; Institute ofChartered Accountants in England and Wales, 1999) that have emphasized theimportance of risk management, there is little evidence of research into risk in relationto the content of budgets or the budgeting process.Address for correspondence: Paul M. Collier. Aston Business School, Aston University, Birmingham
B4 7ET, U.K. E-mail: p.m.collier@aston.ac.uk.
*Aston University
†Manchester Metropolitan University. E-mail: tonyberry3@aol.com
Received 28 March 2002; accepted 10 July 2002.
1044–5005/02/$ - see front matter
c 2002 Elsevier Science Ltd. All rights reserved.
274 P.M. Collier and A. J. Berry
The purpose of the study described in this paper was to further understand
the relationship between risk and how managers perceive and manage risk in the
budgeting process. The study was an exploratory one, to establish similarities and
differences through a comparison of four organizations of different types.
The paper begins by locating the study in the literature of risk and budgeting. The
second section covers the research methods used. In the third section, each of the
four cases is described and in the fourth section the paper identifies similarities and
differences by developing various categories. In the final section, some conclusions
are presented.
1. Theoretical framework
The Concise Oxford Dictionary definition of risk is ‘a chance or possibility of danger,
loss, injury, or other adverse consequences’. However, there is a general lack ofconsensus (Bettis本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。